Telecommunication equipment and service vendor, Ericsson, aims to scale up their business in Indonesia, already a top 10 market for the Sweden-based company, through the provision of machine-to-machine solutions to their large portfolio of mobile operator clients.
Ericsson CEO Hans Vestberg said that Indonesia remained “an extremely important market for Ericsson” as the country was one of its top 10 revenue contributors.
“The country is our largest market in Southeast Asia,” he said during a recent visit in Indonesia.
The trip, which he used to meet the company’s major clients in the cell phone operator sector, is the second of its kind within the last seven months.
Ericsson’s clients include top three operators PT Telekomunikasi Selular, PT Indosat and PT XL Axiata.
These operators have been ramping up their network expansions, especially in regards to third-generation (3G) base transceiver stations (BTS) to accommodate swelling data traffic.
Market research firm, the International Data Corporation (IDC), estimates that total telecom spending will reach US$17 billion by 2013.
Vestberg added that the big potential of the telecommunication sector, as “one of the most important sectors” in many economies, had naturally drawn in competing vendors.
Market players in the telecom vendor business in Indonesia include Nokia Siemens Network and Huawei.
However, Vestberg claimed that Ericsson, as a company that had been operating in Indonesia for over 100 years, had been able to maintain their lead market share-wise.
“In the telecommunications infrastructure sector, we are still larger than the second and third largest companies combined,” he noted.
He further said that the company had sought to “continue being number one” by “executing well”.
“Ericsson is innovating both its infrastructure and services business, which are each filled with different opportunities,” he said.
Ericsson has traditionally provided network equipment,such as radio and antennas, to operators. Yet, Ericsson aimed to push solution services,such as integrating billing systems between operators and banks, to the market.
Magnus Mandersson, executive vice president and head of the global services business unit, said that the provision of such solutions was an expansion from traditional engineering services.
“We would like to continue to be on the front end of systems integration,” he said.
A driver in the need to integrate the information technology system of different companies was the machine-to-machine trend starting to take form in the operator sector.
Operators have often pointed out that they planned to expand their machine-to-machine services, which entails enabling machines to transmit data from one another, allowing machines to “talk” with each other.
Certain operators have rolled out electric metering services, in which electricity boxes in homes are equipped with SIM cards that send information on electricity usage to state utility company PT PLN.
Head of the networks business unit, Johan Wiberg, said the company sought to tap further into this potential area.
“We look to be successful in machine-to-machine solutions,” he said.
However, enabling machine-to-machine operations required operators to upgrade network coverage and capacity.
“This is what we are doing with operators,” he said.